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This Bid's For You

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The problem for Anheuser-Busch's board and current management is that stock investors want growth. And this year, as in the last several years, virtually all the growth in the beer market will take place outside the U.S. In addition, the weak dollar makes it A) more expensive for Anheuser-Busch to buy growth through acquiring brewers in developing markets; and B) cheaper for foreign buyers to snap up U.S. trophy properties like Anheuser-Busch.

What's going to happen? Investors responded to the offer, which tops the stock's 2004 10-year high by 20 percent, by pushing Anheuser-Busch's stock close to the bid. Warren Buffett, who owns about 5 percent of the company, could easily end this by stating a preference. But the bridge player is keeping his cards close to his vest. When I (warning: egregious name-drop coming) had lunch with Buffett yesterday (OK, there were about 20 other people around the table, but I did get to chat with the Oracle of Omaha for a few minutes), he affirmed that he hasn't picked a side in this battle between August Busch and Carlos Brito. (It might be worth pointing out that Buffett has made lots of money recently betting on the financial management skills of Brazilians.) Still, you don't have to have Buffett's acumen to believe that this offer is a good one.

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Member Comments

Posted By: mdfisher @ 07/01/2008 5:55:30 PM

Bud absolutely is made in the U.S. Unlike Ford, it uses completely American ingredients (parts), too. Bud is made in St. Louis, MO, Houston, TX, Merrimack, NH and several other all-American locations.
Posted By: ThePrairiePrankster @ 06/30/2008 3:08:02 PM

Get used to this. As other economies emerge around the world, the successful companies based outside of the USA will want to buy US based companies in order to grow. We in the USA have bought companies based in foreign countries over the past one hundred years and we had no problem doing so, so why is this a problem? If InBev is a well managed international corporation, then it would strengthen the Budweiser brand rather then weaken it, that is what well managed companies do.

But this may not be good news for the many suppliers who provide the grains, hops and containers for AB. That business could move elsewhere. Or perhaps another company will rise to take advantage of what AB and InBev leave behind if they abandon operations in the USA.
Posted By: pinkpanther87413 @ 06/28/2008 5:50:09 PM

I apoligize for going off topic but I still agree with most, we made them rich, and who they are, and they should repay our loyality, but will go for the money, and that is not right in any dimension. I just pray the hops ind that supplied Bud finds a way not to go under, this to would be a great loss, and means more unemployment, and a farmer being paid to grow nothing. Ya it's Capitalism, but the worst kind, the kind who profits the shareholder, but screws the American.. If they installed alt energy, they would not need to move, cause the profit margin would surfice the shareholder. 40 Billion would have done the job, with change.